Advisors Are Piling Into the RIA Channel. That May Not Be a Good Thing
As mega RIAs get bigger, some advisors are saying that the independent channel is beginning to look a lot like Wall Street.
Breakaway advisors are starting to get creative. The steady migration by financial advisors away from the traditional brokerage industry and toward independent financial planning is forcing innovation in the industry.
The so-called breakaway broker trend, now well into its second decade, is causing the independent channel to experience some awkward growing pains.
Mergers and acquisitions, often backed by deep-pocketed private equity investors, have spawned separate categories of registered investment advisory firms, earning nicknames such as aggregators, roll-ups, and mega RIAs.
From some perspectives, this is all part of the plan to help the independent channel stack up against the biggest brand names of Wall Street brokerage firms.
Author's summary: Advisors are moving to the RIA channel.